If you are ordering 34 more, you are getting a discount on the first 66. There is no way Airbus could have avoided it. Reading between the lines, Airbus appears to have been very conservative with the original performance predictions which let Boeing in with a chance.
You are spot on. If you increase an order, you most certainly do re-negotiate the existing component.
Since 2015/16, both A & B have been far more sophisticated with pricing, especially the application of discounts.
Previously, a discount on say 50 aircraft was applied consistently across the entire purchase, unless negotiated in different tranches with discrete time intervals between each. And if there was a deferral or cancellation, the discount was often unaffected. If the customer model-hopped, it was seen as a right that the discount hopped too.
Now, volume discounts are back end loaded. So order 50, and while yes a discount applies from the first delivery, it gets progressively bigger, until back end deliveries may involve only notional payments (for contract binding purposes).
Cancel, defer or model hop, and usually the discount expires, though of course if you replace it with another even larger volume purchase of a different model............
Both pre and post examples ignore inflation impact, which is built into orders.
Original performance projections were conservative, especially as Airbus had NEO performance enhancements banked and ready to go, but not all matched by equivalent A350 enhancements.
Either wait for A350 developments, announced from time to time, or improve the NEO value proposition at the expense of the A350 family (especially A359).
Compromise. Announce some NEO enhancements for deferred availability, softening the impact on the A350, providing time for comparable A350 enhancements to preserve pricing and capability differences.
Last edited by Planesmart
on Thu Jul 19, 2018 12:26 pm, edited 1 time in total.